Cocoon Holdings Limited — Audit Report / Information 2006

Apr 3, 2006

CITIC 21CN COMPANY LIMITED

(incorporated in Bermuda with limited liability)

(Stock code: 241)

CHANGE OF AUDITORS

The Board announces that DTT have been appointed as auditors of the Group with effect from 31st March, 2006 to fill the casual vacancy following the resignation of PwC and shall hold office until the conclusion of the next AGM. The reason for change of auditors of the Group is due to the fact that the Company and PwC could not reach an agreement over the audit fees for the financial year ending 31st March, 2006. PwC confirmed that there were no circumstances connected with their resignation which they considered should be brought to the attention of the members of the Company or creditors of the Group.

The board of directors (the “Board”) of CITIC 21CN COMPANY LIMITED (the “Company”) announces that with effect from 31st March, 2006, Messrs. Deloitte Touche Tohmatsu (“DTT”) have been appointed as auditors of the Company and its subsidiaries (the “Group”) to fill the casual vacancy following the resignation of Messrs. PricewaterhouseCoopers (“PwC”) as auditors of the Group with immediate effect, to hold office until the conclusion of the next annual general meeting (the “AGM”) of the Company. DTT are independent of the Group and not connected with any connected person (as defined in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”)) of the Group. The reason for change of auditors of the Group is due to the fact that the Company and PwC could not reach an agreement over the audit fees for the financial year ending 31st March, 2006.

In their notice of resignation, PwC confirmed that there were no circumstances connected with their resignation which they considered should be brought to the attention of the members of the Company or creditors of the Group. The Board also confirms that there are no circumstances in respect of the change of auditors which it considers should be brought to the attention of the shareholders of the Company. The Board further confirms that other than the abovementioned issue the Group has no other disagreement or unresolved issue with PwC. PwC have not commenced audit work for the Company for the financial year ending 31st March, 2006. At present, the Board anticipates that the change of auditors will not cause any delay in announcing the results of the Company for the year ending 31st March, 2006.

The Audit Committee of the Company who is separately advised by an independent audit firm has discussed and reviewed relevant issues in respect of the change of auditors.

In accordance with the relevant laws of Bermuda and Bye-laws of the Company, the Board is empowered to fill any casual vacancy arising from the resignation of the auditors of the Company. The Board would like to thank PwC for their professional services provided to the Company.

By order of the Board CITIC 21CN COMPANY LIMITED Chen Xiao Ying Executive Vice Chairman

Hong Kong, 31st March, 2006

As at the date of this announcement, the Board comprises nine directors, of which (i) six are executive directors, namely Mr. Wang Jun, Ms. Chen Xiao Ying, Mr. Luo Ning, Mr. Sun Yalei, Mr. Zhang Lian Yang and Ms. Xia Guilan; and (ii) three are independent non-executive directors, namely Mr. Hui Ho Ming, Herbert, JP, Mr. Zhang Jian Ming and Mr. Liu Hongru.

“Please also refer to the published version of this announcement in The Standard.”